f
SECRET
3
measure over leases must technical issues
11
some form of stop-gap be included in the
It will have to be done in consultation with the Chinese, but with the minimum of formality and without legislation.
8.
There are indications that the Chinese are themselves seeing land purchase in the New Territories as a way of boosting confidence and eroding the significance of 1997. China Resources is involved in the major land development at Tin Shui Wai and it is possible that within the next one or two months they may suggest a 20-year lease. Whether they do or don't, this is the sort of eventuality we must now be ready for and consequently must clear our minds quickly on the complex legal issues involved. For instance would it be lawful for us to give such a lease? If not does it matter? If it does, could we find a way round? We will be writing separately about how we can deal with post-1997 leases, if the Chinese agree, or their organisations request it.
9. We will of course also be alert for hints of other possible solutions from the Chinese side.
11
10. If, while we are pursuing these more immediate and mundane issues, the Chinese come up with the long term solution Gu Mu said they must find, of course we will have to look at it indeed look at it very hard. But until something of that sort happens, for my part I would be inclined to disregard such linkage as Gu Mu made between the next step" leases, and the long term future (Peking tel No 69 to Hong Kong, para 2). We are not sure how strongly he felt about it, or how much thought he had given
it, and are inclined to think he did not so much include leases in the next step", or link this with the long term problem, as fail to realise that they were or could be treated as separate problems and at different times.
Cc:
HE Sir P Cradock KCMG
Peking
R D Clift Esq
HKGD, FCO
RJT McLaren Esq
FED, FCO
Mu
SECRET